Potlatch Announces Results of Land Value Stratification Analysis

New York, New York, USA, 11 December 2006 -- (BUSINESS WIRE) -- Potlatch Corporation (NYSE: PCH), a real estate investment trust (REIT), today announced details of the company's land stratification analysis during an investor webcast and conference call from New York City (webcast replay available at www.potlatchcorp.com). Potlatch management presented the company's analysis of its lands with higher values than timberland and its strategies for land value creation.

"After reorganizing as a REIT earlier this year, we began a process of taking a very deep look at all of the values associated with our land holdings," said Michael J. Covey, president and chief executive officer. "Through this intensive land value stratification process, we have identified those lands that are non-strategic to our core forestland operations. These higher valued forestlands are available to be sold over time and the proceeds may be used to fuel the growth of the company through acquisitions, or to pay down debt, or execute a share repurchase program."

Potlatch's entire ownership of 1.5 million acres is located in desirable rural and mountain regions across the country. A significant portion of Potlatch lands have key attributes that make it superior recreational property. Additionally, in keeping with Potlatch's long tradition of managing forestland using the highest levels of stewardship, our forestlands are third-party certified.

"Potlatch's Idaho land holdings are located in the beautiful north-central part of the state, which has long been known for its spectacular wilderness; white water rivers; salmon, trout, and steelhead fishing; and big game hunting," said William R. DeReu, vice president Land Sales and Development. "Potlatch properties in Minnesota are rural, forested, and located within a few hours drive from Minneapolis and St. Paul. The Arkansas ownership, like Minnesota, offers exceptional opportunities for hunting and outdoor recreation in a beautiful mixed hardwood and conifer forest," added DeReu.

The non-strategic lands identified in each region through the initial stratification efforts total approximately 100,000-120,000 acres in Idaho, 100,000-120,000 acres in Minnesota, and 50,000-60,000 acres in Arkansas, or 18% to 20% of the company's current holdings nationwide.

Potlatch is a REIT with 1.5 million acres of forestland in Arkansas, Idaho, Minnesota, and Oregon, and through its taxable REIT subsidiary the company also operates 13 manufacturing facilities that produce lumber and panel products and bleached pulp products, including paperboard and tissue. Potlatch, a verified forest practices leader, is committed to providing superior returns to stockholders through long-term stewardship of our resources.

SOURCE: Potlatch Corporation